The following story looks
at a dark chapter of South Americas history: the rise of right-wing military
dictatorships in the 1970s and their enduring ties to the cocaine trade and international
neo-fascists.

Because of the CIAs
dealings with many of these drug-tainted figures, this history largely has been kept from
the American people. Indeed, while shielding CIA assets from criticism, the U.S.
government has shifted the cocaine blame to leftist "narco-terrorists."

This pattern is repeating
itself today in Colombia as the Clinton administration embarks on a major
counterinsurgency campaign against "drug-financed Marxist guerrillas."

Like his predecessors,
President Clinton is gluing black hats on one side and white hats on the other, when the
truth is far more complicated.

By
Robert Reed

On June 20,
1973, South America teetered between its past and its future. Former Argentine Gen. Juan
Peron, one of the region's legendary strongmen, was returning from a 17-year exile.

Peron's arrival was welcomed by millions of
Argentines from the political left as well as the right, by Argentines who remembered his
populist social programs -- and those who shared his darker fascination with European
fascism. To greet Peron, an estimated two million Argentines surged hopefully to Ezeiza
airport outside Buenos Aires.

Some of the celebrants were young Monteneros, leftists who admired
Peron's pro-labor policies and his nationalistic resistance to the United States. The
crowd also contained Argentines tired of social unrest and yearning for more traditional
order. Others simply were caught up in the political excitement, knowing Peron mostly as
the charismatic leader who married the glamorous Eva Peron, the legendary
"Evita."

But the aging Peron's personal allegiance now stood with a strange
band of bodyguards who flanked him on the dais at Ezeiza airport. Jose Lopez Rega, Peron's
Rasputin-like personal assistant known as "El Brujo" or "The Wizard,"
had picked this multinational team of gunmen from a collection of ultra-right paramilitary
forces.

The security detail included Cuban-Americans from Alpha 66, gunmen
from Italy's Ordine Nuovo, Croatian fascist Ustashi thugs and several Corsican gangsters
who were involved in the infamous French Connection heroin ring.

At the head of this international odd squad was Ciro Ahumada, an
ex-leader of the ultra-right French Secret Army Organization [OAS], which in the early
1960s had engaged in terrorism to block President Charles deGaulle's plans to grant
independence to Algeria.

Another commander was Lt. Col. Jorge Osinde, Peron's intelligence
chief from the 1950s and a close ally of Lopez Rega. In preparation for Peron's return,
Lopez Rega had been named head of the Ministry of Social Welfare, the euphemistic name for
the secret police. Osinde had become Lopez Rega's top deputy.

At Ezeiza, some Argentine idealists, who had hoped for a new golden
age glittering with Peron's charm and charisma, were stunned by the scene of these
black-shirted thugs surrounding Peron on the dais. Some leftist demonstrators began
jeering at the overt fascist presence. The celebration quickly turned ugly.

Amid the commotion, Peron's security force opened fire on the crowd.
Panic swept Ezeiza airport. Bullets tore through leftist protesters and bystanders alike.
Scores of screaming people fell to the ground while others pushed and shoved their way to
safety.

The number of dead and wounded reached into the hundreds. Like a
sudden slap in the face, the massacre ended the utopian dream of Peron as Argentina's
savior.

But the airport incident was only a mild foretaste of the reign of
state terror to come. Though many Argentines might not have understood the full picture in
1973, the reality was that Juan Peron had survived his 17-year exile in large part by
becoming a political ward of Europe's neo-fascist elite.

In the months ahead, Perons patrons would use the frail leader
as a cover for their infiltration of neo-fascist operatives and drug-tainted gangsters
into South America.

The appearance of the gunmen on the dais at Ezeiza airport was the
debut of a new international paramilitary force that would become the backbone of the
Argentine Anti-communist Alliance, the prototype of the modern Latin American "death
squad."

Over the next decade, the "Triple A" and its allies in
Argentine intelligence would spread their gruesome brand of repression throughout Latin
America, drawing the tacit -- and often overt -- support of the CIA.

The strategy also went beyond killing leftists and their perceived
sympathizers. The Argentine neo-fascists and like-minded Latin American military leaders
merged their politics with the region's fledgling cocaine cartels, a marriage of money,
power and violence that survives to this day.

The weird story of Juan Peron's return from exile is a tale, too, of
sex, politics and the occult.

Juan Peron was a singular figure on the world's political stage of
the mid-20th Century.

Born in 1895, he began his public career as an Argentine military
officer. But he quickly gained a reputation for controversy and intrigue.

Assigned to Chile in 1936 as a military attache, Peron was expelled
for espionage. There also were rumors about improper conduct with teen-age acquaintances
of both sexes.

In early 1939, Peron got another foreign posting: to Italy where
Benito Mussolini had pioneered many of the concepts of modern fascism, an ideology that
blended authoritarianism with a near-mystical regard for charismatic leadership. Peron
served with the northern Italian Army's alpine mountaineers until the spring of 1940.

After that stint, Peron traveled through Europe where the Axis
forces of Adolf Hitler's Germany and Mussolini's Italy were on the march. Hitler's army
already had conquered Poland and was moving to occupy Denmark, Norway and the Low
Countries of Europe, before routing the larger armies of Great Britain and France.

Peron was impressed by what he saw. He developed a lasting
admiration for both Mussolini's brand of fascism and Hitler's Nazism.

Upon Peron's return to Argentina, he put into practice much of what
he had observed. Peron joined a secret right-wing military lodge, called the GOU, which
claimed as members about 60 percent of the Argentine officer corps. It reportedly
maintained a liaison to Nazi Germany through Hans Mahler of the German high command.

Peron participated in the GOU's destabilization of the sitting
Argentine government, a challenge that culminated in a military coup in 1943. Peron held
several key cabinet posts in the new government and soon emerged as the
"conductor" of Argentine politics.

A magnetic leader who could improvise and act ruthlessly, Peron
mixed the common-touch folksiness of Ronald Reagan, the athletic virility of John Kennedy
and the populist revivalism of Huey Long.

Though an energetic anti-communist, Peron also was a pragmatist with
no overriding ideological consistency. He used his position as secretary of labor and
social welfare to promote pro-labor reform programs. That gained him broad support from
Argentina's working class and alliances with labor unions. Many Argentines also applauded
his assertive nationalistic stances.

A widower, Peron saw his political stardom reach new heights with
his courtship of Argentine show business personality Eva Duarte. The attractive couple
married in 1945, forming a legendary political partnership that excited a mass political
following especially among common people, whom Eva Peron called her
"decamisados" or "shirtless ones."

When the Axis Powers collapsed in 1945, Peron lost his Argentine
government posts. But he soon recovered his political balance in Argentinas
military-dominated politics. He gained the presidency in 1946, and Eva became the
government's advocate for labor.

While superficially a populist, Peron built a corporate state that
favored wealthy investors, industrialists and technicians. Peron showed loyalty, too, to
his old fascist comrades. He opened Argentina's doors as a safe haven for Nazi exiles,
especially those with scientific skills.

In return, the Nazis apparently rewarded the Perons -- primarily Eva
-- by handing over control of millions of dollars in hidden Nazi assets. The money
reportedly helped the Perons solidify their political power in Argentina through the late
1940s and into the 1950s. [See iF Magazine, Jan.-Feb. 1999.]

Behind the scenes, however, the Perons drifted into increasingly
bizarre personal behavior. They acknowledged an interest in occult phenomena, particularly
spirit worship and seances. A U.S. embassy official told the story of Peron believing that
he had made contact with the ghost of San Martin, the historic liberator of Argentina.
President Peron's dabbling in the occult upset the potent Catholic Church hierarchy.

Peron's political grip loosened further when Eva was stricken with
cancer and died in 1952. As a widower again, Peron began spending time at an athletic
academy for teen-age girls. He developed a particular attraction for a 14-year-old named
Nelly Rivas, who soon became his mistress and later his common-law wife.

The Nelly Rivas affair scandalized the cultural conservatives of
Argentina. For years, rumors about Peron's orgies with teen-agers had circulated through
government circles. But his liaison with Nelly Rivas was an undisputed fact. Conservative
Catholic leaders openly condemned the relationship.

Peron responded to their outrage with scorn. He openly challenged
the church's authority with a package of reforms that demanded legalized divorce,
legalized prostitution and full civil rights for children born out of wedlock. He also
hosted the services of an American Protestant faith-healer called "Brother
Tommy," the Rev. Tommy Hicks, who preached to record crowds in Buenos Aires.

In defying the Catholic Church, however, Peron had overreached. On
June 16, 1955, Pope Pius XII excommunicated Peron and threatened his followers with
similar punishment. When Argentine Catholics were forced to choose between the church and
Peron, they sided with the church. Facing a possible coup, Peron resigned in October 1955
and fled into exile, leaving Nelly Rivas behind.

After his downfall, Peron wandered in jet-age exile across Latin
America and the Caribbean. He was the guest of Venezuela, Panama and the Dominican
Republic.

During his Panamanian sojourn, Peron's "Latin playboy
lifestyle" led his chauffeur to arrange for Joe Cuba's touring cabaret dance troupe
to entertain at a Christmas party where Peron was the guest of honor.

One of the dancers was a beautiful 24-year-old Argentine, called
Isabel. She and Peron met at the party and immediately hit it off. The pair shared not
only an Argentine background but a strong interest in the occult. Isabel had lived for 10
years as a housekeeper for a family of professional spirit healers.

Within three weeks, the couple was living together, as Peron
continued his wandering exile through the Caribbean. Isabel then went with Peron to Spain
where he settled under the protection of far-right dictator, Gen. Francisco Franco. On
Nov. 15, 1961, Juan and Isabel married, though Peron was ineligible for the church
sacrament.

In 1964, Isabel Peron began the slow process of Peron's
rehabilitation. She returned to Argentina on an official visit as Peron's emissary,
testing the political waters.

Jose Lopez Rega, then a police corporal, finagled a personal
introduction, according to Peron biographer Joseph Page. Lopez Rega apparently had served
as a bodyguard for Peron when he was Argentine president. Lopez Rega's favorite photo
showed him riding on the running board of Peron's limousine.

After the meeting, Isabel hired Lopez Rega as a valet and secretary.
He accompanied her on the rest of her three-month visit to Argentina. When Isabel returned
to Spain, Lopez Rega left his wife and daughter to go, too.

Like the Perons, Lopez Rega was fascinated by the occult. With
flinty blue eyes and a hawkish profile, Lopez Rega fit the image of his self-proclaimed
status as a wizard. He divined astrological charts and authored 11 volumes on the
supernatural. He also possessed a dark charisma with a temperament that was described by
other Peron cronies as devious, ruthless and egomaniacal.

Besides his occult interests, Lopez Rega was deeply pro-fascist, a
follower of reactionary philosophers such as Charles Maurras, Walther Darre and Jordan
Genta. Lopez Rega's political views were typical of Argentine right-wing thought and gave
him entrée to the neo-fascist circles of Europe.

In Madrid, Lopez Rega built ties to the old fascist network of Nazi
SS Col. Otto Skorzeny, a Hitler loyalist known as "Scarface" from a dueling
wound. The dashing Skorzeny had been a central figure in protecting fugitive Nazi war
criminals and developing a new generation of neo-fascists.

U.S. Army intelligence documents identified Skorzeny as a leader of
the Nazi's legendary ODESSA network, the underground organization of SS veterans that
helped resettle Nazis in the Peron's Argentina and other countries. [For details on
Skorzeny, see Martin Lee's The Beast Reawakens.]

By the early 1970s, Lopez Rega also was holding conversations with
neo-fascist terrorist Stefano delle Chiaie, who had moved to Madrid after an aborted
right-wing coup plot in Italy in 1970. With Skorzeny's blessing, delle Chiaie worked to
build the new international neo-fascist movement.

During the years in Madrid, Lopez Rega also had made himself
indispensable to his patrons, the Perons. Aging quickly, Peron suffered from a variety of
ailments: a liver cyst, hardening of the arteries and prostate problems.

Lopez Rega nursed Peron and practiced his occult arts of healing. On
one occasion, Lopez Rega was overheard boasting how Peron had once died and was brought
back to life by Lopez Rega's magical powers.

Lopez Rega worked his way deeper into Peron's good graces by helping
arrange the return of Eva Peron's carefully preserved corpse. To deny Peron's followers an
emotional rallying point inside Argentina in the 1950s, the post-Peron government had
secretly shipped Eva's body to a cemetery in Milan, Italy.

On Sept. 23, 1971, Eva's remains were transported from Italy to
Spain where they were turned over to Peron. Later, Lopez Rega moved the body to a second
floor room at Peron's house and ordered Isabel to lie on the coffin. Amid burning candles,
Lopez Rega reportedly performed rituals to transfer Eva's spiritual essence into Isabel.

By the early 1970s, despite his physical decline, Peron was itching
to return to power in Argentina. From Spain, the still-savvy politician cultivated
supporters from the socialistic left, the pro-reform center and the neo-fascist right.
Inside Argentina, Peron's backers orchestrated popular outcries for the exiled general's
return.

The Argentine government helped out by voiding an outstanding
criminal warrant against Peron for statutory rape in the Nelly Rivas affair. According to
some historians, Licio Gelli, who directed Italy's secretive and right-wing Propaganda 2
lodge, chartered a DC-8 jet that returned Peron to Argentine soil for a brief visit in
late 1971.

By June 1973, when the enfeebled Peron made his triumphant official
return to Argentina, he was deeply indebted to the ultra-right networks. They even
supplied the black-shirted bodyguards who flanked Peron as he disembarked at Ezeiza
airport. When disorder broke out, the bodyguards fired indiscriminately into the crowd.

In August 1973, a pro-Peron fill-in president stepped down, clearing
the way for Perons restoration. Peron selected Isabel as his vice presidential
running mate for upcoming elections.

Some Argentines were troubled by the Ezeiza incident and by the
nepotism, but their support for Peron held strong. In October 1973, he and Isabel were
easily elected.

At the time, CIA analysts in Argentina took note of the personal
influence exercised by Lopez Rega, according to biographer Joseph Page.

One CIA cable read: "Peron has lucid periods, interrupted by
periods of depression during which he becomes a dependent old man. In these latter periods
[he] refuses to talk to anyone but his wife and Lopez Rega upon whom
he becomes very dependent."

After his election, the 78-year-old Peron suffered a continuing
health decline. Shadowing the president day and night, Lopez Rega controlled access to
Peron and even installed a microphone in Peron's bedroom to monitor the president's
breathing.

Lopez Rega seemed to exercise even fuller control over Isabel, who
was spell-bound by the charismatic occultist. From Isabel's servant in 1964, Lopez Rega
had transformed himself into her master. He once was quoted as saying, "Isabel does
not exist; she is entirely my creation."

Lopez Rega's Ministry of Social Welfare also provided cover for the
development of the Argentine Anti-communist Alliance, known as the Triple-A, a brutal
paramilitary organization that became the prototype for Latin American "death
squads."

To help organize the Triple-A, Lopez Rega ordered the release from
prison of Francois Chiappe, considered a ranking member of the "French
Connection" heroin smuggling ring.

Since World War II, that ring had worked closely with French
intelligence in exchange for official protection of its heroin shipments from Indochina
through Marseilles to Latin America and then to the United States.

During his presidency, Peron consistently resisted U.S. demands for
Chiappe's extradition. Whenever American pressure forced Chiappe's confinement in
Argentina, he lived in a deluxe jail with fine furnishings, catered meals and frequent
furloughs.

Meanwhile, the U.S. government continued to foot the bill for
Argentina's supposed drug suppression. One $13.5 million aid package went directly to
Lopez Rega's ministry.

With Peron back in power, the Triple-A began a systematic campaign
to kidnap, torture and murder perceived leftists.

Officially, the Argentine government insisted that it was baffled
about the activities of the Triple-A and was busy investigating this mysterious outlaw
band. In reality, however, the Triple-A coordinated its operations with Lopez Rega's
secret police.

In June 1974, Peron slipped into a terminal medical crisis while
Isabel and Lopez Rega were on diplomatic missions in Europe. Reached in Rome on June 19,
Lopez Rega immediately flew back to Argentina where he took charge of Peron's medical
care. Isabel returned on June 28 and went to her husband's bedside.

On June 30, Peron suffered a cardiac arrest. For two hours, the
medical team sought to revive him without success. Lopez Rega then stepped in to try his
hand. He gripped Peron's ankles and uttered incantations. But Peron was beyond Lopez
Rega's wizardry.

"I can't do it, it I can't " Lopez Rega
muttered. "For 10 years, I did it, but now I can't."

Peron's death elevated Isabel to the presidency. But Lopez Rega's
control of the powerful Ministry of Social Welfare and his influence over Isabel
effectively made him the most influential politician in Argentina. On public occasions,
Lopez Rega sat near Isabel and literally mouthed the words of her speeches as she
delivered them. When asked why, he explained that he was channeling the spirit of Juan
Peron to guide her.

Lopez Rega soon found himself an inviting target for the
government's critics. He came under strong criticism for corruption.

His excesses -- both his personal arrogance and the brutality of his
Triple-A allies -- made Lopez Rega politically vulnerable. When Lopez Rega appeared at one
public gathering, a crowd of 80,000 Argentines jeered him off the platform. Soon
afterwards, in July 1975, the military demanded his resignation and Lopez Rega was forced
to step down.

As a sop, Isabel Peron gave him a special ambassadorship that
allowed him to move to Rio de Janeiro, Brazil, and then later to his old haunts in Madrid.
According to his girlfriend at the time, Lopez Rega also traveled to Switzerland seeking
access to the fabled Peron bank accounts.

Back in Argentina, Lopez Rega became a wanted man. An Argentine
military investigation "uncovered" a massive cocaine smuggling ring operating in
Argentina, Paraguay and Bolivia.

The leaders allegedly included Lopez Rega; his deputy, Col. Jorge
Osinde; and Lopez Rega's son-in-law Raul Lastiri, who was Isabela's appointee as president
to the Argentine Congress of Deputies. But the case was not pursued aggressively.

After Lopez Rega's departure, Isabela Peron became the lamest of
ducks. The economy was in ruins and disorder was spreading. The "left-Peronist"
Monteneros and other radical guerrilla groups were stepping up their violent resistance to
the government.

By 1976, the Argentine military had seen enough. Top generals staged
a coup that put Isabela Peron under a comfortable house arrest. Some of Peron's cronies,
such as the Corsican Chiappe, suffered a worse fate. To placate Washington, the military
regime of Gen. Jorge Videla finally extradited Chiappe to the United States.

But most of the drug-tainted Triple-A operation survived and grew
more powerful. Working more openly with the Argentine security forces, rightist goon
squads "disappeared" tens of thousands of suspected leftists.

The victims underwent bizarre tortures that combined Middle Age
crudity with some Nazi-like innovations. There were Medieval-style genital mutilations,
gang rapes, skin peeling, burning with hot coals and acids, and immersion in water
befouled with human waste.

But there were also newer twists to break the human will: applying
electric shocks, using family mementos to inflict pain, engaging in humiliating torture in
front of family members, and involving doctors to make sure that the victim did not die
prematurely.

After the torture, many of the captives were shot and buried in mass
graves. Others were stripped naked, shackled together and dumped from planes into the
ocean.

In the United States, the Carter administration objected to these
gross abuses of human rights. But the CIA maintained close ties to Argentine intelligence
and other right-wing elements in South America.

Some prominent politicians, such as former California Gov. Ronald
Reagan, even expressed public sympathy for the Argentine military. In one radio
commentary, Reagan chastised assistant secretary of state Pat Darien for her human-rights
protests, saying she should "walk a mile in the moccasins" of the Argentine
generals before criticizing them.

The Argentine military also banded together with six other South
American military dictatorships in Operation Condor, which hunted down leftists and other
dissidents around the world.

To finance these and other operations, the intelligence services
relied on illicit sources of cash. According to U.S. Senate testimony by Argentine
intelligence officer Leonardo Sanchez-Reisse, the Argentines funded many of their
paramilitary operations with $30 million in Bolivian drug money laundered through Miami
businesses. [For details, see Robert Parrys Lost History.]

In 1980, using that slush fund, the Argentine military joined forces
with Bolivian drug lords and right-wing military officers to overthrow an elected
left-of-center government in Bolivia. Spearheading the putsch was Nazi war criminal Klaus
Barbie and elements of the same international band of neo-fascist terrorists who had flown
to Argentina with Juan Peron.

Because of the prominent involvement of drug lords, the Bolivian
putsch became known as the Cocaine Coup. After the coup, the drug lords gained government
protection to ship their raw coca to Colombia where the fledgling Medellin cartel
pioneered modern methods of production and distribution of cocaine to the United States.

The next stop for the Argentine intelligence teams and their
drug-supported paramilitary operations was Honduras, where they began training a
Nicaraguan counterrevolutionary army known as the contras.

With Ronald Reagan's election in November 1980, the Argentines
gained a powerful ally in the United States. In 1981, Reagan ordered the CIA to join the
Argentines in training the contras into a full-scale army.

Apparently overestimating their value to Washington, however, the
Argentine generals invaded the British-ruled Falkland Islands, a decision that forced the
Reagan administration to side with Great Britain in crushing the Argentine invasion force.
In 1983, the disgraced generals ceded power to a new civilian government.

After Raul Alfonsin was elected president, investigations into the
"dirty war" estimated that the number of dead may have totaled 30,000. But
Argentine authorities shied away from holding the generals accountable. In 1990, President
Carlos Menem, a Peronista who succeeded Alfonsin, pardoned the leading "dirty
war" generals.

Meanwhile, the mysterious Lopez Rega experienced his own twists of
fate. Apparently unable to access the Peron fortune, he moved to Miami where he lived in
obscurity, frail and sick.

In 1986, the FBI found him and extradited him back to Argentina
where he faced corruption charges.

While incarcerated, Lopez Rega sent letters to Licio Gelli pleading
for help and complaining about abandonment by "The Family," an apparent
reference to Gelli's P-2 lodge and its Argentine allies.

But Lopez Rega had outlived his usefulness. With no one willing to
come to his aid, he died in an Argentine prison in 1989.

Robert Reed is an anthropologist who has studied the intersection of
Latin American drug trafficking and politics.